Good to be an odd man out

As an intellectual alternative to the Anglo-Saxon system and the one Group of Seven country that could be counted on to oppose sanctions against India, France was once a diplomatic and strategic asset for New Delhi because it was the odd man out in the western world. Now, it is the United States that is setting the pace for global accommodation of India. Paris, London and other western capitals now follow in Washington's wake. This poses the question as to what constitutes the basis of the 'strategic partnership' between India and France. Like most European countries, France has little military or diplomatic clout in Asia, least of all in the countries that matter the most to India, like Pakistan, China or the other subcontinental nations.

The greater threat to the Indian interest in France is economic. While there is much excitement about the multi-billion dollar contracts being awarded to French companies in the military and nuclear power sectors, these are largely government-to-government transactions. The heart of the new Indian economy is the private corporate sector and this continues to prefer to give France a miss. Tiny Belgium, for example, is a larger trading partner with India than the second-largest European economy. France's problem is a larger problem afflicting many parts of the European Union: declining economic competitiveness. French firms have a reputation for quality, but quality at a price that cannot compete with southern European countries like Spain let alone export powerhouses like China. Over the past decade, France's share of eurozone exports has slipped over 10% and its standing in various competitiveness indices has either fallen or frozen. The opposite of the 'China price' is the 'France price'. But this means Indian firms tend to see little point in seeking French partners or French technology. Who needs nuts and bolts that carry a champagne premium?

The present eurozone crisis seems to be forcing the present French president, Francoise Hollande, to make the sort of hard decisions about welfare costs and government spending that his country needs. But it will not be an easy path for him to go down given his own socialist background and the anti-market intellectual tradition that still holds sway in the country. If France is to become a partner more in sync with a new post-liberalisation India, the key will be for it to make itself meaner and leaner at home. This, more than anything else, is what New Delhi would like to hear from Paris. Because that is what will guarantee the continuing utility of the West's odd man out for Asia's functioning anarchist.